Multinational Corporations - A global economy: the 1990s

With the development of a truly global economy by the 1990s, opinion with
respect to the multinational corporations in home and host countries
varied considerably. American multinationals have often been viewed abroad
as purveyors of technology and business efficiencies and as bearers of
products meeting an insatiable appetite for American goods. But a more
negative image also developed. The growing competitiveness of the new
world economy and a heightened emphasis on cost efficiencies, job
reductions, retooling, and relocation led to complaints in home and host
nations about declining market shares and lost jobs.

The transnational character of the multinationals proved irksome to the
growing legion of laid-off workers and lower-and mid-level managers who
felt most victimized by the new competition and the search for cheaper
labor markets. Government officials sensed a loss of their sovereignty
because of the ability of these corporations to move their operations,
transactions, and profits upstream or downstream as their self-interests
dictated. Transfers of technology were another issue pitting MNCs and host
and home governments against one another, as they jockeyed to maintain or
gain control of technological breakthroughs for reasons of national
security and profits.

By the beginning of the twenty-first century, the fact that more and more
of the world economy seemed to be dominated by a relatively few
multinational giants also led to the ringing of alarm bells. (Estimates of
U.S. multinational corporations in 2001 ranged around three thousand, but
the numbers were declining because of a wave of corporate mergers.) Other
problems creating tensions between MNCs, host governments, and home
governments included jurisdictional disputes, cultural differences,
nontariff barriers to trade, international agreements among the
multinational corporations, and conflicting political agendas on such
matters of principle as the environment, energy, human rights,
accessibility to proper medical treatment and high-cost pharmaceuticals,
sweatshops, and child labor laws.